Geojit Financial Services research report on CG Power and Industrial Solutions
CG Power and Industrial Solutions Ltd manufactures and distributes electrical equipment such as transformers, reactors and control equipment, as well as industrial motors and pumps and communication systems. In Q3FY25, CG Power’s consolidated revenue surged 27.1% to Rs. 2,516cr, driven by strong double-digit growth in the industrial and power system segments. Revenue from industrial systems rose 19.9% to Rs. 1,591cr. An order intake of Rs. 1,877cr (+37% YoY) and an expanding order backlog of Rs. 2,968cr (+50% YoY) as of December 31, 2024, reflected strong demand for the company’s products. The power system division recorded a 42.4% YoY increase in revenue, at Rs. 920cr, supported by strong order inflow of Rs. 1,759cr (+97% YoY) and an unexecuted backlog of Rs. 5,984cr (+67% YoY) as of December 31, 2024. In Q3FY25, EBITDA increased 26.3% YoY to Rs. 365cr, while margins contracted by 10bps to 14.5% due to a change in the revenue mix; higher contribution from the railway business impacted margins. Profit after tax (PAT) grew 21% YoY to Rs. 238cr, supported by robust revenue expansion.
Outlook
Therefore, we upgrade our rating on the stock to BUY, based on 63x FY27E adjusted EPS with a rolled forward target price of Rs. 696.
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